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Credit cards offer many advantages. There is the convenience of being able to buy needed items now and the security of not having to carry cash. You also receive fraud protection and in some cases rewards for making purchases.

With these advantages also come responsibilities. You need to manage credit cards wisely by understanding all of the card's terms and conditions, staying on top of payments and realizing the true cost of purchases made with credit. Using a credit card is like taking out a loan. If you don't pay your card balance in full each month, you'll pay interest on that loan.

Choose Wisely

The best way to maximize the benefits of credit cards is to understand your financial lifestyle – your money needs and wants. Once you determine how you'll use a credit card, it's important to understand all of the card's features including:

Zero liability means you are not responsible for fraudulent charges when you report them promptly.

In some cases, you have the right to dispute purchases with merchants for unsatisfactory products or services.

Follow the 20-10 Rule

This general "rule of thumb" helps you understand how much credit you can afford. Credit cards are loans, so avoid borrowing more than 20 percent of your annual net income on all of your loans (not including a mortgage). Payments on those loans shouldn't exceed 10 percent of your monthly net income.

As you responsibly use credit cards, you’ll feel the advantages of this alternate payment method. Blog edited by Blog Admin on 9/29/16.

Investment products and services are provided by Arvest Investments, Inc., doing business as Arvest Asset Management, member FINRA/SIPC, an SEC registered investment adviser and a subsidiary of Arvest Bank. Trust services are provided by Arvest Bank. Insurance products are made available through Arvest Insurance, Inc., which is registered as an insurance agency. Insurance products are marketed through Arvest Insurance, Inc., but are underwritten by insurance companies.
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